PayU swings to Ebitda profit in FY26 as payments, credit businesses rally

Bengaluru: Digital payments company PayU India was profitable on an Ebitda basis in FY26, reporting Ebitda of $19 million in the second half of the fiscal year as improvements in payments and lending businesses boosted profitability, parent company Prosus said in an investor presentation accompanying its financial year 2026 (FY26) results. PayU’s EBITDA margin stood at 5% in the second half of FY26 (H2).

The presentation showed that PayU reported an EBITDA of negative $6 million in the second half of FY25 and negative $19 million in the first half.

The payments core sector reported revenues of $384 million in FY26; this was a 3.2% decrease from $397 million in HY26, but an increase of approximately 6% from $362 million in HY25.

EBITDA stands for earnings before interest, taxes, depreciation, and amortization and is a measure of operating profit.

Also Read | Equirus’ 1,500-crore fund stays away from loss-making startups

The presentation showed that PayU India’s revenue grew by 12.5% to $781 million from $694 million in FY26. Full year EBITDA was $18 million in FY26 compared to negative $25 million in FY25, corresponding to an EBITDA margin of 2%.

Under this, the payments business, including the payment gateway unit, grew 10% to $577 million in FY26 from $523 million in the previous year. Payments EBITDA also increased from $3 million in FY25 to $12 million. The loan business grew 19% from $171 million to $204 million and became profitable with EBITDA of $6 million in FY26 versus a loss of $28 million in FY25.

Staying away from low margin businesses

Prosus said PayU India’s improved profitability in FY26 was largely due to its conscious move away from low-margin businesses, even as it scaled faster-growing payment processing volumes. In the payments segment, adjusted EBITDA quadrupled to $12 million, driven by high-margin value-added services (VAS) and software-as-a-service (SaaS) products that accounted for 33% of payments revenue.

Prosus said PayU’s acquisition of Mindgate Solutions helped it build a proprietary third-party app provider stack and person-to-merchant migration, improving transaction success rates and paving the way for new UPI-based services for merchants.

PayU became the majority shareholder in Mumbai-based Mindgate in September, increasing its stake to 70%. The transaction valued the company at approximately $300 million. Additionally, PayU’s acquisition of Wibmo, completed in 2019, gave it a digital payment security and enablement platform that helps strengthen payment processing and transaction reliability.

Also Read | A new group of UPI players is rewriting the cashback playbook

Prosus said PayU, through Mindgate and Wibmo, helps Indian banks process one in every two UPI transactions and three in every four credit card transactions. The presentation also stated that PayU’s payments business has scaled efficiently with a 49% increase in transactions and a 15% increase in total payment volume (TPV) in FY26, while its move away from low-value UPI-heavy segments such as flash commerce and bill payments has helped reduce transaction costs.

In the lending space, PayU has shifted to a partnership-driven, digital-only ecosystem lending model that has improved unit economics and reduced net churn rate from 5% to 4% in FY25.

PayU fixes India bets

Prosus said its India portfolio is increasingly linked through PayU to its payments business, which is involved in most consumer internet betting, including Swiggy, Meesho and ixigo.

PayU reported significant growth across major Indian internet platforms. Gross merchandise value (GMV) processed on Swiggy has increased five-fold on a year-on-year basis as the food delivery platform captures a larger share of payment volumes. PayU’s lending business doubled its loan originations in nine months by lending to both buyers and sellers on Meesho. Meanwhile, PayU saw processed UPI volumes on travel platform ixigo increase by 50% in a month.